New York, N.Y., and Costa Mesa, Calif., May 4, 2010 — Providing greater insight into the health of the U.S. economy, Standard & Poor's, the world's leading index provider, and Experian®, the global information services company, announced today that they are joining forces to launch a series of consumer credit default indices in the United States. The S&P/Experian Consumer Credit Default Indices, to be launched on May 18, 2010, will seek to measure the balance-weighted proportion of consumer credit accounts that go into default for the first time each month.
Unlike other publicly released metrics that recount previously defaulted loans or that measure delinquency rates only on securitized loans, the S&P/Experian Consumer Credit Default Indices are based on a broad cross-section of the entire U.S. consumer credit population.
The S&P/Experian Consumer Credit Default Indices will consist of four headline indices as determined by loan type, and a composite index: S&P/Experian Auto Default Index, S&P/Experian First Mortgage Default Index, S&P/Experian Second Mortgage Default Index, S&P/Experian Bankcard Default Index, and S&P/Experian Consumer Credit Default Composite Index. The balance-weighted Composite Index will measure default rates across all four loan types.
Additionally, granular indices by geography (at the Metropolitan Statistical Area, state, census division and census region levels) will be available, as well as custom indices that can be created based on specific client requirements.
“Built from the monthly payment data generated by the lenders and aggregated by Experian, these Indices will provide a timely, detailed look into the actual payment behavior of U.S. consumers,” says David Blitzer, Managing Director and Chairman of the Index Committee at S&P Indices. “In addition, since the Indices will allow us to get a pulse on the current default profile of consumers, they could also serve as a leading indicator on the direction of the U.S. economy.”
The Indices are calculated based on data extracted from Experian's consumer credit database. This database is populated with individual consumer loan and payment data submitted by lenders to Experian every month. Experian's base of data contributors includes leading banks and mortgage companies, and covers approximately $11 trillion in outstanding loans sourced from 11,500 lenders. These lenders report to Experian based on billing cycles, which are spread throughout a month. All these data are aggregated monthly as of the archival date, which is the last Saturday of every month. The index values are then published on the 3rd Tuesday of the following month.
“Experian is committed to providing the market with transparent and relevant information regarding the health of the U.S. consumer credit population,” says Ethan Klemperer, General Manager of Experian Capital Markets. “The S&P/Experian Consumer Credit Default Indices offer a clean, true measure of loan losses worthy of being the standard benchmark for analyzing the changing payment behaviors of borrowers.”
More information on the S&P/Experian Consumer Credit Default Indices will be published to http://www.standardandpoors.com/indices upon launch of the Indices on Tuesday, May 18th.
About Experian Capital Markets
Formed as a response to market needs, Experian Capital Markets leverages Experian's comprehensive global consumer and business databases to provide data and analytics to serve the transparency needs of the structured finance market participants. By taking underlying borrower data and applying advanced analytics, Experian provides insight into consumer and business credit behavior across all obligations, helping to forecast future payment patterns on prepayments, delinquencies, charge-offs or defaults for non-agency residential mortgage–backed securities and other asset-backed securities.
Experian is the leading global information services company, providing data and analytical tools to clients in more than 65 countries. The company helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score and protect against identity theft.
Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended March 31, 2009, was $3.9 billion. Experian employs approximately 15,000 people in 40 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; Costa Mesa, California; and São Paulo, Brazil.
For more information, visit http://www.experianplc.com.
Experian and the marks used herein are service marks or registered trademarks of Experian Information Solutions, Inc. Other product and company names mentioned herein may be the trademarks of their respective owners.
About S&P Indices
S&P Indices, the world's leading index provider, maintains a wide variety of investable and benchmark indices to meet an array of investor needs. Over $1 trillion is directly indexed to Standard & Poor's family of indices, which includes the S&P 500, the world's most followed stock market index, the S&P Global 1200, a composite index comprised of seven regional and country headline indices, the S&P Global BMI, an index with approximately 11,000 constituents, and the S&P GSCI, the industry's most closely watched commodities index. For more information, please visit www.standardandpoors.com/indices.
About Standard & Poor's
Standard & Poor's, a subsidiary of The McGraw-Hill Companies (NYSE:MHP), is the world's foremost provider of independent credit ratings, indices, risk evaluation, investment research and data. With offices in 23 countries and markets, Standard & Poor's is an essential part of the world's financial infrastructure and has played a leading role for 150 years in providing investors with the independent benchmarks they need to feel more confident about their investment and financial decisions. For more information, visit http://www.standardandpoors.com
Standard & Poor's does not sponsor, endorse, sell or promote any S&P index-based investment product. The S&P/Experian Consumer Credit Default Indices are products of S&P Indices, which operates independently of Standard & Poor's Ratings Group. Standard & Poor's Ratings Group plays no role in the compilation, distribution or licensing of the Indices.
David R. Guarino
Standard & Poor's
212 438 1471 Telephone
714 830 5462 Telephone